Jeffrey Wade
The Apollo 11 crew, including Neil Armstrong, Buzz Aldrin, and Michael Collins, famously struggled to get life insurance before their historic mission to the moon. The astronauts were federal employees, and their salaries did not leave much room for life insurance premiums. The dangerous nature of their mission also meant that few life insurers were willing to offer an affordable rate. To solve this problem, the crew came up with a unique idea: they autographed hundreds of postal envelopes (known as covers) during their pre-launch quarantine, which they knew would increase in value if they did not return, providing financial support for their families.
| Characteristics | Values |
|---|---|
| Do astronauts get life insurance? | Yes, but it is difficult to obtain. |
| Why is it difficult? | Life insurance is about risk assessment. Insurers were unwilling to provide coverage for astronauts due to the high risk of mortality associated with space missions. |
| How did astronauts overcome this challenge? | They devised a strategy involving the signing of hundreds of postal covers or envelopes (called "Apollo insurance covers") before their missions. These were left with a trusted person and later distributed to their families in the event of their death. |
| Who were the first astronauts to use this strategy? | The crew of Apollo 11, including Neil Armstrong, Michael Collins, and Edwin 'Buzz' Aldrin. |
| What was the value of these autographed covers? | The covers could be sold for substantial amounts, ranging from $20,000 to $46,000 or even up to $30,000 for an Apollo 11 cover. |
| Were subsequent Apollo missions also insured? | Yes, insuring astronauts became marginally easier after Apollo 11's success. The crew of Apollo 12 was insured for $50,000 each, which is approximately $316,000 accounting for inflation as of February 2017. |
What You'll Learn
Apollo 11 astronauts' self-insurance plan
The Apollo 11 astronauts struggled to get life insurance, so they came up with a self-insurance plan. Neil Armstrong, the first man on the moon, estimated that the Apollo 11 mission only had a 50% chance of a successful landing. However, he believed his chances of a safe return were much higher. Despite this, few life insurers were willing to offer a low enough rate for the astronauts to afford. NASA itself was barred from taking out insurance by law.
The astronauts' self-insurance plan involved the use of signed and stamped postal covers, which they prepared before their mission. They reasoned that if they did not return, these would be valuable and could be sold to benefit their families. This pseudo-insurance system continued until Apollo 16, the penultimate moon mission. The plan was slightly scandalised when Apollo 15 astronaut David Scott took some of the covers with him to the Moon, intending to sell them after his return.
The refusal of life insurance companies to provide coverage for the Apollo 11 astronauts prompted them to devise this strategy. They signed hundreds of postal covers, which were to be left for their families to sell in the event of their deaths. The covers were printed by The Manned Spacecraft Center Stamp Club in Houston, Texas (the MSCSC Covers), and a friend of the astronauts, Al Bishop (the "Bishop Covers"). The Apollo 11 covers normally fetch the highest prices as they were from the first lunar landing mission.
The American government also encouraged the crew to provide for their families in other ingenious ways. For example, the astronauts took memorabilia with them on board, such as pieces of wood from the Wright Brothers' plane, which could be sold at auction in the event of their deaths.
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The role of NASA in compensating families
Astronauts have long struggled to obtain life insurance due to the high risk associated with their line of work. As a result, they have had to devise creative ways to ensure their families are compensated in the event of their deaths. One example of this is the Apollo insurance covers, which were autographed postal covers signed by astronaut crews before their missions. These covers were left with a trusted person and would be sold by the astronauts' families in the event of their deaths.
Despite the challenges in obtaining life insurance, it is important to note that NASA has played a role in compensating the families of astronauts who have died during space missions. This became evident following the Space Shuttle STS-51L Challenger disaster in January 1986, which resulted in the deaths of seven astronauts. While only one of the astronauts, Christa McAuliffe, had life insurance, NASA and Morton Thiokol made compensatory payments to the families of the other astronauts. The compensation was reported to be worth US$7.7 million in tax-free annuities, plus additional cash settlements.
In another instance, NASA paid a total of US$26.6 million to the families of the seven astronauts who perished in the 2003 Columbia space shuttle disaster. The settlement was negotiated out of court by former FBI Director William Webster, with the funds obtained through a congressional appropriation in 2004. The privacy of the families was protected, and the specific amounts received by each family were not disclosed.
While NASA has made efforts to compensate families, astronauts themselves have also taken steps to ensure their families are provided for. In addition to the Apollo insurance covers, astronauts have also taken memorabilia with them on missions, which could be sold at auction in the event of their deaths. Additionally, some astronauts have taken out their own insurance coverage, typically arranged by their respective space agencies, with values ranging from US$2-3 million.
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The Travellers' Insurance Company's offer
The Travellers Insurance Company's offer to insure the Apollo 11 astronauts was a significant moment in the history of space exploration and the insurance industry. The company, based in Hartford, Connecticut, and incorporated in Minnesota, stepped up to provide coverage for Neil Armstrong, Michael Collins, and Edwin 'Buzz' E. Aldrin, Jr., who were facing challenges in obtaining affordable life insurance due to the high-risk nature of their mission.
The Travellers Insurance Company's offer was made even more remarkable by the fact that US regulations forbade NASA from paying for the insurance out of their budget. The premiums for the Apollo 11 astronauts' policies were paid for by the Austral Oil Company and the Cullen Central Bank, recognizing the importance of protecting these national heroes. However, Neil Armstrong blocked any publicity surrounding the deal, making it challenging to find exact details about the policy today.
The company's willingness to insure the astronauts reflected its history of innovation in the insurance industry. The Travellers Insurance Company, founded by James G. Batterson, was established to provide accident insurance for travellers after he experienced first-hand the benefits of such coverage while travelling in England in 1859. Over the years, they have continued to pioneer new types of insurance, including the first automobile policy in 1897 and the first space travel policy in the late 1960s for the Apollo program astronauts.
The offer to insure the Apollo 11 mission demonstrated The Travellers Insurance Company's forward-thinking approach and their understanding of the importance of protecting individuals, even in high-risk endeavours. This offer set a precedent for future space missions and contributed to the development of space exploration. While the specific terms and conditions of the policy may remain unknown due to Armstrong's modesty, the impact of The Travellers Insurance Company's decision extended beyond the Apollo 11 crew, shaping the way insurance companies approach unique and challenging situations.
The Travellers Insurance Company's offer to insure the Apollo 11 astronauts was a pivotal moment, not just for the astronauts and their families but also for the advancement of space exploration. It showcased the company's adaptability and willingness to take on complex risks, setting a standard for the industry and paving the way for future innovations in insurance and space travel.
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The sale of autographed postal covers
The Apollo missions saw the rise of a unique form of insurance for astronauts: the autographed postal cover. With life insurance companies refusing to provide coverage for these intrepid explorers, the astronauts devised a strategy to ensure their families were provided for in the event of their deaths. This took the form of signing hundreds of postal covers before their missions, which could then be sold for substantial amounts if the worst were to happen.
The autographed postal covers were first introduced for the Apollo 11 mission and continued until Apollo 16. The covers were signed by the astronaut crews prior to their missions and were then left with a trusted colleague. In the event of a successful mission, these covers could be sold or retained as valuable mementos. However, if the astronauts did not return, the covers would become highly sought-after collectibles, with their value skyrocketing. This provided a financial safety net for the families of the astronauts.
The practice of signing covers began with the Apollo 11 crew, who spent time in quarantine before their historic flight. During this period, they signed hundreds of covers, which were then given to a trusted colleague. The covers were printed by MSCSC Covers and Bishop Covers to commemorate the lunar mission. The essence of a true insurance cover was that it was signed while in quarantine before the launch and left behind for the families. To ensure authenticity, it is ideal to have the reverse of the cover certified by one of the crew members.
The Apollo 11 insurance covers are particularly valuable due to the significance of the mission as the first lunar landing. The covers signed by Neil Armstrong, Michael Collins, and Buzz Aldrin are highly coveted. Subsequent missions, such as Apollo 12, 13, and 14, also saw the signing of covers, with some appearing at auctions and selling for high amounts.
The Apollo 15 mission, however, presented a controversy. The astronauts of this mission carried about 400 unauthorised postal covers into space, with the crew agreeing to take payments for this. This incident, known as the Apollo 15 postal covers incident, led to reprimands for the astronauts involved and negative media coverage. Despite this, autographed postal covers remain a unique and valuable piece of space history, providing not only financial security for astronauts' families but also a fascinating insight into the world of space exploration.
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The future of space tourism insurance
The future of space tourism is an exciting prospect, with companies like Blue Origin, SpaceX, and Virgin Galactic leading the charge. The global market for space tourism is projected to exceed $6 billion by 2030, presenting lucrative opportunities for insurance brokers. However, the development of space tourism also poses new challenges for the insurance industry. Here's an overview of the future of space tourism insurance:
Complexities and Risks
The nature of space tourism presents unique complexities and risks that insurers must consider. Space travel is inherently risky, and the development of commercial spaceflight brings new challenges in risk management and mitigation. As space tourism ventures push further into space, insurers will need to address a broader range of risks, including technical failures, health and safety concerns, and the psychological and physiological effects on passengers.
Innovative Insurance Solutions
Dynamic Market Opportunities
Space tourism insurance presents dynamic market opportunities for brokers. By diversifying their portfolios to include space tourism, brokers can stay ahead of industry trends and attract a new client base. Space tourism also offers opportunities for partnerships, networking, and risk management expertise development. Additionally, the high-net-worth individuals and prestigious companies involved in space tourism can elevate brokers' books of business and create opportunities for high-value clients.
Regulatory Considerations
The regulation of space tourism insurance is still evolving. Currently, there are discussions around whether this new market should be governed by aviation or space law. As the industry matures, insurance regulations and policies will need to adapt to support its development and address the unique risks and challenges posed by space travel.
Data Limitations and Risk Assessment
One of the significant challenges in insuring space tourism is the limited data available. Space tourism is a relatively new industry, and insurers do not yet have comprehensive insight into all potential risks. The limited operations and flight safety data make it difficult to accurately assess and underwrite these risks. However, as the industry grows and more data becomes available, insurers will be better equipped to address these challenges.
In conclusion, the future of space tourism insurance is both promising and complex. As space tourism moves towards becoming a reality, the development of innovative and comprehensive insurance solutions will be crucial to managing the unique risks and challenges posed by this emerging industry.
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Frequently asked questions
Yes, the Apollo 11 crew did have life insurance, despite the high cost of insuring such a dangerous mission. The Travellers' Insurance Company offered to insure the crew, with the premiums paid for by the Austral Oil Company and the Cullen Central Bank.
The Apollo 11 crew needed life insurance because there was a "real chance" they would not return from their mission, as described by space historian Robert Pearlman.
The Apollo 11 crew struggled to obtain life insurance due to the high cost of insuring a dangerous mission. As a result, they devised a strategy to ensure their families would be provided for in the event of their deaths. They autographed hundreds of postal covers, which they left with a trusted friend. These covers would become highly valuable if the crew did not return and could be sold by their families.
Yes, subsequent Apollo missions became marginally easier to insure due to the success of Apollo 11 and the availability of more data. For example, the crew of Apollo 12 was insured for $50,000 each, which is equivalent to around $316,000 per astronaut as of February 2017 when accounting for inflation.
Yes, modern astronauts do obtain life insurance, although the process may not be straightforward due to the high-risk nature of space travel. Some astronauts have taken out insurance policies worth $2-3 million, arranged by their respective space agencies. Additionally, it is believed that the Canadian Space Agency directly insures its astronauts.
